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Take stock in derma e® and take your natural skincare sales to new heights Want more info? www.dermae.com/bsb or call 800.521.3342 64 January 2014 | beautystorebusiness.com www.dermae.com and paid advertising. The principal legal caution about advertising on social-media sites is that all sites retain the right to remove ads and content that violate their site policies. Businesses don't have any legal recourse if an expensive ad campaign is taken down for violating site terms. Sweepstakes and contests are regulated differently by each state, and social-media sites all put the burden on the advertiser to find, analyze and comply with the state laws. This can be a complicated task. For example, some states require sponsors to post bonds and register with the state depending on the value of the prize. Most states say that only the state can operate a lottery, and so advertisers need to avoid falling within the regulatory definition of a lottery. Advertisers can accomplish this by carefully analyzing the elements of a lottery and making certain not to include all of them in their sweepstakes. Typically there are three elements to a lottery: (1) a person pays for a ticket; (2) has a random chance of winning; (3) gets a prize for winning. It doesn't cost anything to enter a sweepstakes, so sponsors of sweepstakes leave out the element of consideration, or giving something of value to enter, and as a consequence avoid operating a lottery. But sweepstakes can't demand anything of value for entering or they may cross the line. Contests can't have any element of random chance, or they will have all the elements of a lottery. As a result a contest sponsor can't draw straws to resolve a tie. Because of the difficulty of checking the evolving requirements in each of the 50 states, an expert is often a valuable resource for structuring sweepstakes or contests. Each social-media site has a set of rules that form part of the contract that advertisers enter into when they buy ads or run promotions. When designing an ad or promotion, it is important to check the rules of the site where your ad or promotion will run. Some of the rules to keep in mind include: Facebook has an explicit rule barring false or misleading ads, similar to every other social-media site's public statements. All ads on Facebook must lead to a landing page, which typically has content promoting the advertised product or service. Facebook requires landing pages to permit easy navigation away from them. Any sweepstakes or contest must have rules that release Facebook from liability, and must acknowledge that Facebook doesn't endorse, sponsor or administer the promotion. Sponsors can't require sharing on a Timeline to enter the contest. Twitter's rules require advertisers to get explicit permission before using any Tweeted contest or sweepstakes submission as part of an ad. Contest sponsors must provide clear instructions with a description of how winners will be selected. Ads can't look like a Tweet or have actions that mimic Twitter actions, such as follow, retweet, favorite or reply. Yelp doesn't post its advertising terms and conditions, but its site terms of service make clear that it can block access to the social-media site for no reason and without notice. YouTube can temporarily or permanently suspend websites that violate its advertising policy. User-generated content can only be incorporated into ads if the users have approved it. Foursquare is a social-media site designed to connect people and businesses, so it naturally offers a range of advertisement opportunities. Businesses can purchase information about a subscriber's location and use that to send a message when the subscriber is nearby. Instagram announced in October of 2013 that it would start posting ads in its feed. Unlike the topics covered in the first of these two columns on social media, where preexising law and rules were extended to include social media, brand protection and advertising in the context of social media requires businesses to prioritize their risks and resources. ■ This copyrighted article is intended to help make you aware of some of the issues that you may face, but it is not exhaustive and does not constitute legal advice. You should consult your lawyer for legal advice about the particular circumstances of your beauty business. Jean Warshaw is a lawyer in private practice in New York City. She provides advice on business and environmental law. She can be reached at 212.722.2240.